The Reserve Bank of India’s (RBI) Digital Payments Index (DPI) rose to 349.30 in March 2022 from 304.06 in September 2021, reflecting the rapid adoption of digital payments in the country.

Launched in January 2021, the DPI index indicates the extent of digitization of payments across the country.

“The RBI-DPI Index has demonstrated significant growth representing the rapid adoption and deepening of digital payments across the country in recent years,” the central bank said in a statement.

The RBI-DPI was constructed with March 2018 as the base period, i.e. the DPI score for March 2018 is set to 100.

In March 2019, the index stood at 153.47. and in September 2019 it rose to 173.49, followed by 207.94 in March 2020, 217.74 in September 2020 and 270.59 in March 2021.

RBI said the index would be released on a semi-annual basis with a 4-month lag.

The DPI index comprises five major metrics that measure the depth and penetration of digital payments in the country over different time periods. Metrics include payment enablers, with a weighting of 25% in the index, followed by demand-side and supply-side payment infrastructure factors, with a weighting of 10% each, payment performance, with a weighting of 45%, and consumers. centricity, with a weighting of 5%. Each of the parameters has sub-parameters which, in turn, consist of various measurable indicators.

Digital payments have grown by leaps and bounds over the past two years, due to the pandemic.

Among digital payment methods, the number of transactions using real-time gross settlement (RTGS) grew by 30.5% in 2021-22. In terms of value, RTGS transactions recorded an increase of 21.8%; transactions through the National Electronic Funds Transfer (NEFT) system also saw an increase of 30.6% and 14.3% in volume and value, respectively, reflecting the increase in high-value corporate transactions, in line with growth in economic activity, RBI’s annual report said.

Payment transactions using credit cards increased by 27% and 54.3% in terms of volume and value, respectively, and debit card transactions decreased by 1.9% in terms of volume, although that in terms of value, they increased by 10.4 percent.

Prepaid Payment Instruments (PPIs) recorded an increase in volume and value of 32.3% and 48.5%, respectively. In FY22, UPI processed over 46 billion transactions amounting to over Rs 84.17 trillion, crossing the $1 trillion mark. And, in FY21, it processed 22.28 billion transactions, worth Rs 41.03 trillion. Thus, the volume and value of transactions doubled in one year, indicating the meteoric rise in the adoption of digital payments, especially UPI, in the country.